One World, Ready or Not: The Manic Logic of Global Capitalism

1. One World, Ready or Not: The Manic Logic of Global Capitalism Chapter 17 – Buruh Sejahtera William Greider

2. “Free” Trade? “In the global marketplace defined as free trade, everyone is free, it seems, but the people.” p. 389

3. The Contradiction of Capitalism • In the business world, 1. MNCs can move from market to market 2. Investors can insist on terms for use of their capital 3. Governments can demand concessions in exchange for commercial opportunities • In the developing countries, 1. People are regulated by the state as a commodity 2. People are deprived of the most basic individual freedoms a. free speech, right to associate freely with others

4. Capitalism and Exploitation “While it claims to promote human freedom, it profits concretely from the denial of freedom, most especially freedom for the workers employed by capitalist enterprise.” p. 388 • Exploitation is extracting profits from the inherent weakness of other human beings 1. Industrial wage is so low that it cannot sustain minimal livelihood 2. Government is actively preventing workers from changing their situation

5. Capitalism and Exploitation “Multinationals are creaming the poor countries of the world for cheap and disposable labor, with the collaboration of governing elites in those nations.” p. 390 Firms use low cost labor in developing countries Wages increase Firms move on to other poorer nations and repeat the process Result: The process thwarts rising wages and increased consumer consumption but enriches local elites and global producers

6. Rationale of Capitalism “Commerce helps civilize the backward peasants recruited for factory work…These people are not yet equipped for the experience of individual expression, democracy or labor rights, but their jobs and wage incomes will, in time, educate them to expect more from life. Meanwhile they are grateful for the work.” p. 389 • Rational offered by MNCs in defense of these practices is not different from those offered by American slave owners • “Grateful” factory workers are staging many strikes in countries where it is illegal to do so and could result in imprisonment

7. “Grateful” Workers Strike “In Indonesia—where more than 30 million people earn an average of $40 a month in factories producing clothes, shoes and consumer electronics for export—labor disputes have become an everyday affair: there were 2,265 last year.” – Time Asia “At the age of twenty-one, Emi Sukarni found herself leading a strike against her employers at an underwear factory in Jakarta. The strike was peaceful, but the personal penalty for Emi was to lose her job. She describes her growing disillusion with big factory bosses, and the humiliating working conditions for a cheap labor force.” - BBC News

8. Jakarta • Jakarta can be described as a developing country that incurred rapid growth. • Huge department stores, High rises, elevated highways and rapid transit system • During his time in Indonesia for meeting of APEC (Asia-Pacific Economic Cooperation), "Clinton, like others, expressed his admiration for what the New Order of Presidents Suharto has accomplished during the general’s thirty-year reign. p 391 • Annual growth average 7% for two decades • Per capita income tripled to $650 expected to triple • Recognized as one of the ten “BEMs” – “Big Emerging Markets” • Opportunities

9. Operasi Berish • “Operation Cleansing” • Military troops cleared the streets of beggars, thieves, prostitutes, and political dissidents • Professors, students, artists, lawyers were considered political dissidents • Security troops were ordered to watch over person that would embarrass the country for the sake of their group interest. • Dr. George Aditjondro • Muchtar Pakpahan • “Controversial” news magazines shut down

10. Regardless of the growth statistics, Indonesia’s national economy was something of a fiction. Away from the glamorous sections of Jakarta the streets were clotted with uncollected garbage, broken sewers, and smoky buses. The growth only occurred in Jakarta, Surabaya and a couple of other Javanese cities. 60% of industrial output was from Jakarta Mercedes, more in the city than in Boston and cost three times as much Control of power is at the center. Jakarta’s Economy

11. The Question of Human Freedom “U.S. leaders periodically expressed their concern and threatened trade sanctions; Indonesian generals responded with appeasing gestures. American officials investigated notorious restrictions and set deadlines for reform. Suharto announced reforms and deadlines passed.”p. 394 • How can the Indonesian people improve their situation when leading countries applaud the economic success of the country and do not address the issue of human rights? • Economic growth and the human condition are treated as separate subjects

12. Labor Unions Labor Unions are an association of workers that seek to improve the economic and social well-being of its members through group action in negotiation with employers. • Employment contracts • Wages • Working conditions “The spontaneous walkouts were mainly directed at a single grievance: thousands of companies simply ignored the government’s new wage law, confident nothing would happen to them, knowing many of their young workers were not even aware of the law.”p. 395

13. Types of Unions If the Government doesn’t care then who will? • Indonesia Prosperity Trade Union (SBSI) In 1992 this union was formed to combat against the established union SPSI which is sponsored by the government and affiliated with the ruling party, GOLKAR. It is a yellow union that invariably backs employers against their workers. • Indonesian Centre for Workers Struggle (PPBI) This party was formed more recently and is affiliated with the Peoples Democratic Party which is a banned social-democratic opposition party that includes artist groups, students and farmers.

14. “The problem with these labor unions was that they didn’t fulfill the government requirement. To win official status, a new union must recruit 100,000 members in one thousand chapters and at least five provinces, then gain membership in a sanctioned labor federation with ten similar unions. Since the only legal federation was the government-controlled one, the rules ensured that any genuinely free trade union would be illegal.”p. 396

15. Protest Muchtar Pakpahan was the chairmen of the new independent labor federation which was an illegal union designed to prove that the workers were not going to put up with the harsh treatment of the government • He was arrested for organizing a rally without a permit • He was arrested for insinuating riots • He was arrested and charged for subversion “On April 14th, thousands of workers marched peacefully on the government’s office, carrying banners that proclaimed: Give us the right to organize!” and “We’re Not Beasts of Burden.” When they were turned away by soldiers, a full scale riot ensued-workers storming through the streets, smashing windows and luxury cars, looting scores of shops. The specter of ethnic violence that has haunted Indonesia since 1965 was revived.” p. 400

16. End Result Since the government has thwarted all the attempts of the unions, YAKOMA, a church group-supported social foundation through an informal training center for young people. GOALS: 1. To organize workers 2. To educate workers on their rights 3. To stress the importance of coming together

17. A Proposition “People are desperate, really desperate, to find jobs. That is the ultimate black hole for the workers – this vast number of people who say they are willing to work under any terms.” ~Trini Leung, labor activist for Hong Kong Federation of Trade Unions • The same opinion leaders who celebrate the virtues of free competition among firms are strangely silent on the subject of free labor p408 • Trade lawyers oblivious

18. Labor Rights An Economic Strategy • Require producing nations to meet the internationally recognized standards for labor rights • Establish the basic human rights of self-expression • Authorize nations to impose penalty tariffs • Block goods from most abusive producers • Force the economic system to share returns more broadly and thus create a middle class of consumers • Slow and gradual progress

19. Arguments Against International Trade Standards • Foreigners must not intrude on the culture and domestic politics of other societies “Seems quite fatuous, given that foreign commercial interests have already intruded on those societies.” p409 • Requires monstrous bureaucracy – investigators and regulators who must examine the social realities in various countries. • Promoting a high-minded version of protectionism • Injure the very people who are supposedly being helped

20. Pros of International Trade Standards • High-wage workers benefit from solidarity with the poor “..to put it crudely, a nation that sends its children into the sweatshops is not sending them to school.”p410 • Advantage against highly paid workers in the wealthiest economies • Threat of capital flight gone

21. Implementing International Trade Standards • “The introduction of labor rights is the necessary predicate for ever reaching that prosperous future, whether those rights are achieved by orderly global politics or by decades of bloody conflicts and social explosions in poor societies.” p411 • Must come from advanced democracies like the US • Impose as a condition of access to their markets • Global minimum wage “At the end of the day, the question is whether capital has the option to exploit these peasants who will do anything for work.”

22. NOTES • British Broadcasting Channel • British Broadcasting Channel • East Timor Alert Network • Encarta • Indonesian Observer • Jakarta Online • More or Less • President Suharto • Time Asia

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